I was lucky enough to be invited to Media 140 in Perth recently to discuss what the ‘big idea’ is with social media.

The idea was for a context setting discussion about social media and how it is changing business and society.

DIGITAL REVOLUTION

I was lucky enough to be invited to Media 140 in Perth recently to discuss what the ‘big idea’ is with social media.

The idea was for a context setting discussion about social media and how it is changing business and society.

DIGITAL REVOLUTION
We are living through a digital revolution that is changing the world we inhabit as absolutely and as irrevocably as the industrial revolution of the late eighteenth and early nineteenth centuries.

That previous industrial revolution changed our relationship with time, with money, and with people. It created the wage labourer that we know, and the unions whom we’ve to come know encapsulated by the term ‘organised labour’. It created a society governed by the mechanical clock and the notion of work versus non-work time.

The digital revolution is on a similar scale, and this scale is based on a remarkable shift in the means of production. The digital revolution has at its roots a democratization of access to the means of communication.

EXPECTATIONS AND ACCESS TO COMMUNICATIONS TECHNOLOGY
As a result we are seeing a shift in the expectations of ordinary people about communications technology and their access to that technology. Further, we are seeing a rapid evolution of behaviour in relation to communications technology – mainly in the use of smartphones and tablets.

All of this is leading us to significant shifts in society, and it is all fuelled by innovations in communications devices. The smartphone and almost ubiquitous access to the internet have created a new baseline expectation in people that they will always be connected. I have often argued that with Twitter we are seeing the genesis of the hive mind of humanity.

The digital divide is no longer about access to technology – as my friend Mark Pesce notes, even poor fishermen in Kerala have access – it’s about your willingness or desire to be connected.

However, people are finding enormous utility in being always connected. For example, the number of ereaders in the hands of people is growing enormously, doubling since July 2011. And an example of a behavioural shift afforded by the technology is the growth in women’s erotic fiction sales. Romance novels have always been a big business globally, but a recent sales data indicates a substantial growth in sales of erotica (the so-called ‘guilty pleasures’ factor) that has been fuelled by the anonymity offered by ereaders.

As long ago as 2008 Australia mobile phone subscribers outnumber people according to ACMA data. This means that individuals have more than one device connected to the mobile phone network.

SOCIAL MEDIA, SOCIAL BUSINESS
Along with this embrace of ubiquitous mobile connectivity we have seen the growth of social media and social networking. This growth of social media is part of the landscape that makes up the digital revolution. Social media is revolutionary because it empowers the populace with access to the means of communication that were once the province of rich media barons.

This growth in social media fuelled by mobile connectivity has also changed the business landscape in important ways. There is a shift from command-control and pipeline driven businesses to social business that is focused on continuous engagement and conversations.

The kind of new business opportunities enabled by this digital revolution include:

• the ability to compete in a new geography without even opening a local store (like Amazon);
• the opportunity to reduce complexity for customers and remove friction from business operations (like Telstra);
• subverting traditional models like recruitment where businesses build online talent banks of people who are interested in working with them (like Deloitte).

However, the shifts in society are not limited to business and consumers. They are also changing some things that we have always accepted. For example, we have always assumed that there is a just and valid separation between the domains of public versus private, or between business versus personal. But now those verities are being shaken by social media and social networking.

Social media is blurring the boundaries between the public, private, business, and personal. We are still working out how to negotiate this new territory. But already we see reports of people turned down for jobs because their online reputation score was too low.

We are now seeing a world where reputation is created, maintained, and mediated by online channels. There are increasing tools for measuring reputation online, such as: Kred, Klout, and Peer Index. Bouncers are even reportedly using Facebook as an identification check for entry into nightspots according to the BBC.

SOCIAL WORKPLACES
Workplaces are changing too, partly in response to the digital revolution. Open plan offices with collaboration spaces and hot desks are enabled because of wifi and portable connected devices like laptops and tablets.

SOCIAL EDUCATION
Our schools and places of education are being swept along by this digital revolution as well. With schools handing out laptops to all students and wifi in schools, libraries, and on public transport our children inhabit an always connected landscape. A teen boy said to me recently of my complaints about the poor wifi in Sydney: “but it’s just in the air, it’s everywhere”. It is a good example of the world that our young people inhabit. They live in a world where the connectivity is just ‘in the air’ around them.

The physical changes in workplaces are being reflected in schools too. They are becoming focused on collaboration rather than rote learning of facts. Students are learning how to discover, assess, and synthesize information rather than memorize facts.

WTF?
When we put together the shifting physical nature of the workplace and schools together with the blurring boundaries between public- private-business-personal, and the always connected devices in the hands of individuals many opportunities and challenges arise.

It is an exciting time to live. We are living through a revolution. The real question is will we drive the revolution or let it just happen to us?

I don’t think that many romanticise war too much these days. And there is something very poignant and compelling about seeing the fruits of war.

In northern France and Belgium the unimaginable scale of loss wrought upon so many families in the great wars of the twentieth century [...]]]>

I don’t think that many romanticise war too much these days. And there is something very poignant and compelling about seeing the fruits of war.

In northern France and Belgium the unimaginable scale of loss wrought upon so many families in the great wars of the twentieth century is still visible at every step.

It was in north eastern France that I found some family graves. Here is the the resting place of young ANZAC Rupert Alexander, aged 31 years, along with his compatriots lost in France in 1917.

This poem by Gellert captures the melancholy of war:

Anzac Cove

There’s a lonely stretch of hillocks:
There’s a beach asleep and drear:
There’s a battered broken fort beside the sea.
There are sunken trampled graves:
And a little rotting pier:
And winding paths that wind unceasingly.
There’s a torn and silent valley:
There’s a tiny rivulet
With some blood upon the stones beside its mouth.
There are lines of buried bones:
There’s an unpaid waiting debt :
There’s a sound of gentle sobbing in the South.

By Leon Gellert

“They shall grow not old, as we that are left grow old:
Age shall not weary them, nor the years condemn.
At the going down of the sun and in the morning,
We will remember them”
Lest we forget

This talk by Bitly’s Matt LeMay at Monki Gras entitled: Kitteh vs Chickin: How What We Share is Different from What we Click is important and is really worth watching.

This talk gives us some really important [...]]]>

This talk by Bitly’s Matt LeMay at Monki Gras entitled: Kitteh vs Chickin: How What We Share is Different from What we Click is important and is really worth watching.

This talk gives us some really important insights into the changed world we now inhabit.  The world in which our passing fancies and offhand comments were written on the wind has passed into history.  Now most things that we click or share online are recorded and ready for analysis.

Matt draws out the point that our real selves – the ones  who listen to Lady Gaga or Katie Perry and then delete them from our scrobbles - are revealed by our online activities.

As Jung suggested, it might be time to embrace our shadow (or as Matt LeMay suggests, learn to be okay with being a kitteh).

I commend this video to you, it presents important concepts in a really engaging way.

While trawling around on YouTube recently I came across a 1980s video of Tim Finn’s There’s a Fraction too much Friction and it got me thinking about the things that annoy me  in dealing with businesses. I concluded that [...]]]>

While trawling around on YouTube recently I came across a 1980s video of Tim Finn’s There’s a Fraction too much Friction and it got me thinking about the things that annoy me  in dealing with businesses. I concluded that the source of my irritation is friction.

I have long observed that business has many things in common with war, and friction is probably the thing that most comes to mind as significant in both business and war.

The problem with friction is nicely put by Clausewitz:

“Everything in war is simple, but the simplest thing is difficult. The difficulties accumulate and end by producing a kind of friction that is inconceivable unless one has experienced war.”

This description of the effects of friction in war are eerily reminiscent of dealing with a large business (say for example, one of our large telecommunications companies).

The huge opportunity that the digital revolution offers is to remove friction between different parts of businesses – between customers and staff, between operational silos within the organisation, between groups who are internal and external to the organisation.

Organisations that see and act on this opportunity are the ones that will triumph in the hyperconnected future.

People who see a dedicated niche that they can service seamlessly and effectively will grow their businesses almost without trying, and customers will flock to them.

In this milieu the one-stop-shops that try to do everything – those who previously leveraged scale and centralization – are likely to suffer.  This is because scale creates and does not reduce friction. Only in the past when the friction in having services and products delivered from many smaller suppliers was so great did the one-stop-shops have an advantage.

But now even small organisations can remove friction and deliver seamlessly to their customers using web and mobile applications.

Now organisations are liberated to serve customers in ways that were impossible before ubiquitous internet connected mobile devices.

Big companies that are not already offering effective online services are the new dinosaurs.  It will take only the slightest change in their terrestrial trading conditions for them to sicken and die. Two examples of this phenomenon  worth keeping an eye on are Harvey Norman and David Jones . It will be very interesting to see if they can evolve their business models sufficiently fast to survive.

Reduced information asymmetry is another opportunity offered by this reduction in friction.  In the past companies, especially retailers, had better information about pricing of the good they sold.  Now this asymmetry in access to pricing information is dying. A recent tweet from my friend Mark Pesce exemplifies this new trend:

And US retailer J.C. Penney recently launched a new pricing model:

“J.C. Penney (JCP) is permanently marking down all of its merchandise by at least 40% so shoppers will no longer have to wait for a sale to get the lowest prices in its stores.

Penney said Wednesday that it is getting rid of the hundreds of sales it offers each year in favor of a simpler approach to pricing. On Feb. 1, the retailer is rolling out a three-tiered strategy that offers “Every Day” low pricing daily, “Monthly Value” discounts on select merchandise each month and clearance deals called “Best Price” during the first and the third Friday of each month when many shoppers get paid.”

Source: Daily Finance, 25 Jan 2012 

The results of this pricing experiment are just starting to flow in.  There has been an initial drop in sales revenue but analysts note:

“We believe our findings demonstrate that the strategies announced to transform (Penney’s) business are the right actions to take and will resonate well with consumers over time” (Source: MSNBC, Penney’s pricing strategy takes a toll on sales, 30 Mar 2012)

Against this backdrop it is amusing to see an Australian retailer’s response to market conditions – “David Jones Outlines Strategic Plan to Cut Costs” along with their very late in the day online shopping initiatives. It is especially amusing when one observes one of their chief competitors, Net-a-Porter – saying:

“It’s very easy to copy the look and feel, which people have helped themselves generously to,” Massenet said. “But we have 12 years of building ahead [of other sites] and we are sending out 5,000 orders a day as opposed to 20 orders a day and I think it’s very difficult for a business to keep up with that operationally.”

Source: Sydney Morning Herald, How to create an e-empire, 29 Mar 2012

Net-a-Porter is an excellent example of an organisation that has nailed servicing a niche, delivering good product, and ensuring a good customer experience supported by excellent customer service.

The bar has well and truly been raised for traditional organisations. And only those who work out how to reduce friction and deliver seamless service will survive.

As companies embrace the notion of a reputation economy fueled by the power of social platforms this brings a new set of challenges for management and employees.

I was at the Salesforce #cloudcrowd event in Sydney recently and we were discussing this issue with guest speaker

As companies embrace the notion of a reputation economy fueled by the power of social platforms this brings a new set of challenges for management and employees.

I was at the Salesforce #cloudcrowd event in Sydney recently and we were discussing this issue with guest speaker Peter Coffee.

The issue is that companies increasingly require employees to interact online on behalf of the company but using their own persona.

Upon consideration, it is not much different to offline where one meets with business contacts using a real name.  But the difference is that those meetings are mostly written on the wind.  Online interaction is forever. It is an almost permanent record of where you were, what you said, and to whom it was said.

Thus for the employee, the private conversations and meetings of the past have transformed into public online interactions, potentially geotagged and with accompanying photo.

What this is doing is tying the individual’s personal reputation very closely with that of the company in a very public and well documented way. In the past it was relatively easy (especially in a big city) to gloss over a former job and what you really did in it.

But now this will become increasingly difficult as more and more of our business interaction is transacted in public and online.

It will also become increasingly difficult for companies on several levels:

• Firstly, they will find it more challenging to repudiate the activities and actions of employees, since these will be well documented online.
• Secondly, they will find their public reputation increasingly tied explicitly to employee behaviour as played out in various online forums.
• And thirdly, there is the risk that employees will use online forums to share their feelings (both positive and negative), as per the very colourful  examples of Goldman Sachs’ former employee Greg Smith Why I Am Leaving Goldman Sachs or Google’s James Whittaker Why I Left Google.

Problems for employees include:

• Their online personal behaviour as private citizens can mean missing out on a job. For example, How Facebook could cost you your job! One in five bosses has rejected a job applicant after checking out their profile on social media sites.
• We will continue to see blurring between personal behaviour online as private citizens and our behaviour as employees. For example, Blurring the Lines Between Work and Personal Life on Facebook.

Rawn Shah’s October 2011  presentation gives a nice overview of the issues involved in The Blurring of Job Loyalties, Social Collaboration and Personal Freedom.

One thing is certain, the boundaries between private citizens and their online activity as representatives of a company is starting to blur and this is likely to increase.  It also means that we individuals will increasingly be subject to ongoing and continuous surveillance from companies as well as the government.

Privacy is truly dead.

For many years now my friends, colleagues and I have been talking and thinking about the hyperconnections made available to us by the growth of the internet, telecommunications devices and networks, and social platforms. For a good background on it check out Mark Pesce and

For many years now my friends, colleagues and I have been talking and thinking about the hyperconnections made available to us by the growth of the internet, telecommunications devices and networks, and social platforms. For a good background on it check out Mark Pesce and Ross Dawson.

But I think that we have reached a state in our evolution as human where the practices of hyperconnectivity have changed the way we are doing, being, and thinking.

Connectedness is no longer about technology it is about people. Our need for connectedness is beginning to transcend the technology. I believe that, even if the internet disappeared tomorrow, our desire for and expectation of connectedness would continue and that the behaviours engendered by the internet will remain to be expressed.

Ian Shafer summed it up nicely recently:

“I think this whole notion of connectedness is more a state of human evolution than rather a generational thing.”
from: Ian Shafer, in Generation C: A new demographic label for marketers by Kai Ryssdal, 24 Feb 2012

Movements like #Occupy and the Arab Spring around the world show that people connecting is more than just a technology thing, although technology has amplified the ability of people to connect across distance.

Human beings don’t want to just engage and connect with brands, a desire to create a world better suited for the beings that inhabit it (and their progeny) is growing and we see real life communities growing.

A good example of this Social Innovation Sydney. It started online but this community connects in real life meetups and the human network creates connections, relationships, and activities far beyond the initial starting point.

If the internet disappears tomorrow how will you be able to find your tribe?

This video of Dr Deming discussing the state of management in the US from 1984 is strangely prescient. I think this is rather important!

Definitely worth watching and pondering for all of us …

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This video of Dr Deming discussing the state of management in the US from 1984 is strangely prescient. I think this is rather important!

Definitely worth watching and pondering for all of us …

Seth Godin wrote about the the attention economy. But it seems to me that we are also seeing the evolution of an online social recommendation economy.

When we all lived in villages there was a strong recommendation economy, and it was fuelled [...]]]>

Seth Godin wrote about the the attention economy. But it seems to me that we are also seeing the evolution of an online social recommendation economy.

When we all lived in villages there was a strong recommendation economy, and it was fuelled by the fact that everyone knew each other and their reputation. Word of mouth drove choices about which business to patronise and which individuals with whom to socialize. Reputation was everything, and it was protected fiercely on olden days.

With the shift of population to large cities we became disconnected from the hyperlocal reputation economy. But with the digital revolution and the growth of social networking platforms we are seeing a return to the reputation economy for both individuals and businesses.

There is also a growing recommendation economy developing via social media and social networks. This growing recommendation economy is no longer volitional. Instead you are a participant even if you never signed up (refer to my previous post on Klout for some examples).

We are now seeing the growth of explicit social recommendation networks. However, a number of other social networks serve to provide insight into the influence of individuals or brands but these recommendation networks aim to aggregate and rank user’s influence.

Some of the players in this space include:

• Kred
• Peer Index
• Klout
• Empire Avenue
• Linked In

These networks are all aimed at measuring online influence, and this need is largely driven by marketing needs. As traditional media continues to fragment marketers are seeking to identify those influencers who can help them to connect with audiences.

As Mashable summarised back in 2009, mostly these platforms use metrics to assess influence:

“Incoming Traffic – Pageviews, Incoming traffic from search engines, rss subscribers
Incoming Links – Primarily manual links such as blogrolls, in-post deep links
Reader Engagement – Internal searches, time on site
Recommendations – Retweets, share stats
Connections – Number of mutual connections, number of mutual connections on multiple sites
Track Record – Age of domain, number of blog posts, length of engagement
Engagement – How often and long a person has engaged with a service online”

Source: HOW TO Measure Online Influence, Micah Baldwin, 2009

This means that everything we do online is potentially subject to analysis of this nature. And, even if we are participating in ‘private’ social networks, there is the chance that our activity can also be subject to this kind of analysis.

Even if we do not choose to participate in the recommendation economy it is happening, just like it used to happen to everyone in a village.

Along with all of this we are seeing the development of recommendation markets, where people connect and exchange information about the quality of information, connections, work, etc of people or businesses within their networks. Increasingly this kind of recommendation network is driving job search, new business, business connections, and innovation.

This means we need to work out how to benefit from this new environment.

WHAT TO DO

Probably the best advice about managing one’s reputation comes from Maslow via Wayne Dwyer:

“Self-actualized people are independent of the good opinion of others.”

And he goes on cite Dr Seuss:

“Be what you are and say what you feel, because those who will mind don’t matter and those who matter don’t mind.”

From my point of view the only practical response is to keep doing your thing, whatever that might be. To analyse results and take feedback from reliable sources.

But, as I know from experience, if you try to please everyone then everyone ends up unhappy (I’m sure Oscar Wilde said something along those lines too).

Above all we need to accept that we now dwell in a panopticon, and like the villagers of old, we are always under observation in the digital world. This new reality has implications for our comportment online. It means that we need to monitor responses to our activity and adjust our own responses to the current situation.

It also means that even those who do not choose to play in the online arena are playing (whether they like it or not). Reputations are no longer a private matter, instead we live in a digital global village where our reputations are common currency and we rise or fall on the recommendations of others.

This new environment means that we need to remain vigilant, stay connected, and build up social capital to enable us to survive when things do not go well. Just like in a village it is the quality of our relationships that will make life easier.

READING

Some other interesting analyses of this phenomenon include:

• Bertrand Duperrin, Is reputation a new currency?

• Sidneyeve Matrix, Social Job Search

As we move away from the power structures and ways of thinking that governed the twentieth century we are seeing a desperate rearguard action from the power elites who ruled that time.

A good example of this is the film and music [...]]]>

As we move away from the power structures and ways of thinking that governed the twentieth century we are seeing a desperate rearguard action from the power elites who ruled that time.

Dying Dinosaur Industries in their Death Throes

A good example of this is the film and music industries, whose centralized model of creation and distribution is breaking down.

The proposed US anti-piracy legislation to protect film, music and other intellectual property from unauthorized distribution – SOPA in the House and PIPA in the Senate – has shown deep divides between modern hyperconnected businesses and old world centralized, command-control industries. And it is now reported that the SOPA bill has been shelved after global protests from Google, Wikipedia and others.

The rearguard action by the old industries is also clear in threats against those who fail to support the old industries:

“Consumer group Public Knowledge on Friday accused the Motion Picture Association of America (MPAA) and its head, former Sen. Chris Dodd, of trying to intimidate lawmakers into supporting a pair of controversial anti-piracy bills.

In recent days, Dodd and other top Hollywood figures have threatened to cut off campaign donations to politicians who do not support their effort to crackdown on online copyright infringement.”

Source: The Hill: Consumer group accuses Hollywood of ‘threatening politicians’, by Brendan Sasso, 01/20/12 04:08 PM ET

We are seeing increased efforts from the old guard to control people and their communication. But the genie of a hyperconnected populace is out of the bottle. And it cannot be put back. Even if they remove the internet as we know it – free flowing and accessible to all – we will invoke Gilmore’s Law and route around that damage

The Economy and the Death of the Western Middle Class

The death of these old industries has important implications for society. These industries enabled the creation of a well-off middle class in the latter half of the twentieth century.

But with the digital revolution many the economic drivers that created the twentieth century middle class have disppeared, as outlined in this article about Apple and US jobs.

And even in Australia we are seeing the gradual shift of middle class jobs overseas, as in this recent example from Westpac, Ultimate insult: Sacked Westpac workers forced to train replacements.

It is becoming apparent that even new businesses no longer guarantee jobs like they used to. For example: ‘No new jobs, dollars’ in bulk stores.

The truth about job creation is only now beginning to dawn on us, and we are seeing the inevitable social and economic consequences of transferring work from high cost to low cost economies.

People are even starting to ponder which jobs will disappear next – for example Will these 10 jobs disappear in 2012?

The old industries employed sufficient numbers of the western populace to keep them in comfortable consumerist peace. Their children could afford an education and thus improve their lot in life. The idea that each generation would be materially better off than the previous seemed unassailable.

But now it seems that truth might no longer hold. The #Occupy movement is seeking to bring attention to the economic bifurcation of society between the the very well-to-do and the strugglers.

Embracing the Future

Those who are not trapped in the old model are embracing the evolving world that is fuelled by the digital revolution. They are accepting the dispersed, decentralized, and peer-to-peer future.  The old intermediaries are dying (or are in their death throes), and in their place new ones are arising.

The future is about human beings  connecting with each other. It is about collaboration and cooperation. It is about sustainable growth. And it is about making space for people to create new possibilities unconstrained by the behemoths of centralized command and control.

Author Paulo Coelho summed it up nicely on his blog recently:

“As an author, I should be defending ‘intellectual property’, but I’m not.

Pirates of the world, unite and pirate everything I’ve ever written!

The good old days, when each idea had an owner, are gone forever.

First, because all anyone ever does is recycle the same four themes: a love story between two people, a love triangle, the struggle for power, and the story of a journey.

Second, because all writers want what they write to be read, whether in a newspaper, blog, pamphlet, or on a wall.

The more often we hear a song on the radio, the keener we are to buy the CD. It’s the same with literature.

The more people ‘pirate’ a book, the better. If they like the beginning, they’ll buy the whole book the next day, because there’s nothing more tiring than reading long screeds of text on a computer screen.”

Source: My thoughts on S.O.P.A. by Paulo Coelho on January 20, 2012

Recently I was re-reading Oscar Wilde’s De Profundis, a moving letter from prison that looks at spirituality and faith from the depths of despair and degradation.

This particular quote stood out for me, especially the notion that we do not know ourselves very [...]]]>

Recently I was re-reading Oscar Wilde’s De Profundis, a moving letter from prison that looks at spirituality and faith from the depths of despair and degradation.

This particular quote stood out for me, especially the notion that we do not know ourselves very well.

“But with the dynamic forces of life, and those in whom those dynamic forces become incarnate, it is different. People whose desire is solely for self-realisation never know where they are going. They can’t know. In one sense of the word it is of course necessary, as the Greek oracle said, to know oneself: that is the first achievement of knowledge. But to recognise that the soul of a man is unknowable, is the ultimate achievement of wisdom.

The final mystery is oneself. When one has weighed the sun in the balance, and measured the steps of the moon, and mapped out the seven heavens star by star, there still remains oneself. Who can calculate the orbit of his own soul?

When the son went out to look for his father’s asses, he did not know that a man of God was waiting for him with the very chrism of coronation, and that his own soul was already the soul of a king.”

Oscar Wilde – De Profundis

It seems, as we move into the interesting year of 2012, that this is a good time to turn our efforts towards understanding ourselves more fully. And, along with that, to discover how to accept ourselves as we are, both flawed and fabulous in parts.

I have come to suspect that our good relations with others hinge more upon our own understanding and acceptance of our own self than upon any other thing.

Hopefully we are not fated to suffer – as did Wilde (or Verlaine or Prince Kropotkin) – similar trials to achieve clarity and understanding.